In its first year of operations, Sheridan Company recognized $31,000 in service revenue, $7,700 of which was on account and still outstanding at year-end. The remaining $23,300 was received in cash from customers. The company incurred operating expenses of $20,100. Of the exe expenses, $13,090 were paid in cash; $7,010 was still owed on account at year-end. In addition, Sheridan prepaid $2,950 for insurance coverage that would not be used until the second year of operations: (a) x Your answer is incorrect. Calculate the first year's net earnings under the cash basis of accounting and caiculate the first year's net earnings under the accruat basis of accounting